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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: mishedlo who wrote (56461)3/22/2006 10:42:27 AM
From: John Vosilla  Read Replies (1) of 110194
 
"I am not sure this part is correct however "with average 30 yr fixed rate with 20% down and corresponding RE taxes and insurance added in.". I fail to see how down payment matters except for your proposal of measuring payment. It probably should not be payment but the median price itself. Otherwise you are constantly assuming that everyone always owes exactly 80% of their home at all times. That does not seem right. There might also be some double counting issues as well (ie:for those that think the FED should target inflation by raising interest rates, yet interest rates themselves are used to measure inflation in your example). Care to rethink that part? One other issue: how go you handle property tax deductions. Renters do not get them (except for one state), and most can deduct them. So.... property taxes should be after deductions perhaps."

Then take what the national average of loan to value figure is at the time. Isn't LTV today somewhere around 50%? So you are right my 80% is off and doesn't account for changes going on in the real world. On your other points about discounting of new homes and tax deductions that complicates it too much without really changing the changing snapshot much at all. You already have median national home prices, median national rental rates, median sq footage, percentaqe of owners versus rentals, national LTV ratios, current interest rates.. Can also probably get RE taxes and insurance since rates are readily available as well though that is probably the hardest part of all with the homestead cap factored into the rate already since a segment of the total pool ends up paying a disproportionate share of the pie due to those with caps on RE. Wow maybe this leads to something?
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